Colorado Department of Transportation maintenance worker Dan O'Connor, of Steamboat Springs, sweeps the curb along U.S. Highway 40 just west of 13th Street during a ditch maintenance project. CDOT workers locally are among those who will be affected by statewide budget shortfalls.

Local agencies brace for additional revenue shortfalls

Steamboat Springs  Projected state budget shortfalls may mean less mental health services for the needy and a shortage of grant funding, but don't expect any reductions in snowplows or patrollers on state highways.

Routt County has been spared from some of the state's largest and most conspicuous budget maneuvers because it isn't home to any major state nursing units, mental hospitals, universities or prisons. But local officials said Wednesday that they won't completely avoid sharing in the pain, especially as state revenue forecasts continue to show shortfalls.

On Monday, the nonpartisan Colorado Legislative Council released its September revenue forecast, which showed a $560.7 million shortfall in the state's 2009-10 budget. The shortfall is $240.7 million higher than a $320 million shortfall previously forecast and addressed by Gov. Bill Ritter. The state is facing a combined $1.3 billion shortage this fiscal year and next. It is not clear how the state will attend to the additional deficits announced Monday, but local agencies are bracing for hits.

The city of Steamboat Springs and Routt County may abandon plans for a firearms training facility if scheduled grant awards continue to be canceled.

"If there is no grant round, then that project is really not going to go anywhere," city grant writer Winnie DelliQuadri said.

Some local employees of the Division of Wildlife, Routt County's state parks, Colorado Department of Transportation and Colorado State Patrol already are participating in four statewide furlough days and preparing for more.

"There is an anticipation that we could see additional furlough days," said Weldon Allen, Region 3 transportation director for CDOT.

Tom Gangel, of Colorado West Regional Mental Health, a 10-county organization that includes Steamboat Mental Health, said state funding constitutes about 45 percent of the organization's total budget.

"We are anticipating in our 10 counties another $250,000 in cuts," Gangel said. "It's a hell of a lot to us. We've already absorbed $500,000 in cuts."

Gangel said Colorado West already has laid off some employees and instituted a hiring freeze and furlough days. There have been no layoffs to date in Steamboat, but Gangel said that may be necessary in the future.

Gangel said Medicaid reimbursements are a likely place the state will look for cuts, which would impede Steamboat Mental Health's ability to provide therapy and psychiatric services to low-income patients.

Capt. Rich Munroe, of the Colorado State Patrol's Craig Troop Office, said the state has committed to maintaining essential services and public safety. He said patrols have not been reduced and that he does not expect them to be, but some civilian employees and uniformed administrators have taken part in furlough days. Similarly, Allen said CDOT's strategy has been to cut projects rather than maintenance.

"We need to maintain and take care of what we own," he said. "What it will affect is new construction."

Grants on hold

DOW spokesman Randy Hampton said that while the division was not exempt from furloughs, it is funded primarily by hunting and fishing licenses and, therefore, immune to the state's general fund shortfalls. Hampton acknowledged that fewer hunting and fishing licenses are being sold, but he said the effects of that won't be felt until the next fiscal year, which begins July 1, 2010.

John Twitchell, a Steamboat-based forester with the Colorado State Forest Service, said his agency also is in a unique situation. As part of the Colorado State University system, budget maneuvers are not identical to those being carried out in other branches of state government. As such, state foresters are not taking furlough days, Twitchell said, but salaries have been frozen.

Proposed cuts to higher education, however, could ultimately mean big impacts on the state forest service and other components of the CSU system. As one of the six largest sectors of state spending, higher education has a big target on its back as the state looks for savings.

State Sen. Al White, R-Hayden, said that, so far, the state has backfilled cuts to higher education with federal economic stimulus money. White said Ritter will ask for a waiver that would allow the state to further reduce its contribution to higher education without jeopardizing the stimulus funds. The problem with that, White said, is that when the stimulus money runs out, the state would have to pour about $250 million back into higher education, or state colleges and universities will see shattering decreases.

"That's a problem that's looming for higher education," White said.

White, a member of the state Legislature's Joint Budget Committee, said he couldn't speculate on future cuts until he sees what Ritter proposes. Ritter's August budget cuts of $320 million included about 100 items, such as the elimination of 270 full-time employees, a $25 million cut to the state prison system and cash transfers from programs that provide grants for projects in regions including Northwest Colorado.

The grants are funded by federal mineral lease and severance tax payments, and awarded to local governments impacted by energy development. Local governments also receive direct distributions from these revenues. While direct distributions increased in many areas in 2009, Associated Governments of Northwest Colorado Executive Director Aron Diaz said both sources of revenue for Western Slope areas including Routt County are threatened.

For example, the Department of Local Affairs canceled the planned grant awards in August. One project vying for money was a $200,000 collaboration between the city of Steamboat Springs, Routt County and other regional governments to study energy use and identify possible savings.

Temporary suspensions to the state's sales tax rebates to businesses and property tax exemptions for seniors likely will continue for at least another year. The state normally compensates businesses for the bookkeeping involved in sales tax payments with a 3.3 percent rebate. The homestead property tax exemption, when in place, reduces seniors' property tax bills by 50 percent up to the first $200,000 of assessed valuation.